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Behavioral impact of implementing standard cost system (adapted from CMA exam). Windsor Healthcare, Inc., a manufacturer of custom-designed home health-care equipment, has been in business for 15 years. Last year, in an effort to better control the costs of their products, the controller implemented a standard cost system. Reports are issued monthly for tracking performance, and any negative variances are further investigated.The production manager complained that the standards are unrealistic, stifle motivation by concentrating only on negative variances, and are out of date too quickly. He noted that his recent switch to titanium for the wheelchairs has resulted in higher material costs but decreased labor time. The net result was no increase in the total cost of producing the wheelchair. The monthly reports continue to show a negative material variance and a positive labor variance, despite the fact that there are indications that the workers are slowing down.
a. Describe several ways that a standard cost system strengthens management cost control.
b. Describe at least two reasons why a standard cost system may negatively impact the motivation of production employees.
Explain how an increase or decrease in partnership liabilities can affect the basis of a general partner and a limited partner.
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bill jensen a staff member of zhan amp co. cpas has provided you the following list of what he refers to as internal
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The security market line indicates that a 5% premium above the risk-free rate is desirable. If U.S. Treasury bills are paying 2%, estimate the cost of common stock capital.
Lindon Company is the exclusive distributor for an automotive product that sells for $45 per unit and has a CM ratio of 35%. The company's fixed expenses are $330,750 per year. The company plans to sell 22,000 units this year.
The overhead costs that Sife Industries, Inc., used to compute its overhead rate for the past year are as follows. Compute the past year's overhead rate. Compute the overhead rate for next year.
1) The profession of tax practice involves four principal areas of activity. Discuss these four areas. 2) Tax Rates. Latesha, a single taxpayer, had the following income and deductions for the tax year 2013: INCOME: Salary $60,000 Business Income 25,..
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